General purpose reloadable (GPR) prepaid cards and entry-level checking accounts have both evolved to a point where product features and functionality of the two are nearly indistinguishable between the two. A new research report titled, The Blurred Lines Between Debit and Prepaid Cards considers the differences between the two products and why providers and users might favor one over the other.
“At first glance, prepaid and debit appear so similar that one could conclude that the payments industry took two separate paths to end up with the same product. Initially prepaid product providers were developing solutions to offer users a bankcard-like product. Now financial institutions are seeing inspiration in GPR card attributes, comments the co-author of the report.
Highlights of the research report include:
- A comparison of some of the regulatory differences between debit and GPR cards.
- Market sizing for prepaid and debit, including a look at the decline in the unbanked population in the U.S.
- Review of the features and functionality of leading GPR cards and entry level checking accounts from five U.S. banks.
- The role that GPR cards have and continue to play in banking and payments innovation.
- The Market for General Purpose Reloadable and Debit Card
Product Features: How Different Are GPR Prepaid Cards from Debit Cards?
Learning from Market Examples
- Early Direct Deposit
- Conveniently Managing Cash
- Overdraft Cushion
Did the Prepaid Card Industry Reinvent the Wheel?
Conclusions: Beyond Serving the Underserved, GPR Prepaid Card Is Needed for Payments Innovation
- Related Research
Appendix A: A Comparison of Five Leading GPR Prepaid Cards
Appendix B: A Comparison of Entry-Level Bank Checking Accounts